Tesla shareholders appear to support CEO Elon Musk’s efforts to… highest compensation package in American corporate history.
A day before any official Tesla announcement, Musk common that the resolution to approve his compensation package price as much as $56 billion and the resolution to maneuver Tesla’s legal home from Delaware to Texas “missed by a wide margin.”
Musk posted charts showing that each numbers received more votes than needed for a “guaranteed win.”
Tesla shares increased after the news.
Both Tesla shareholder resolutions are currently passing by wide margins!
♥️♥️ Thank you for your support!! ♥️♥️ pic.twitter.com/udf56VGQdo
— Elon Musk (@elonmusk) June 13, 2024
Shareholders vote on the compensation package they approved for the first time 2018what a judge from Delaware overturned earlier this 12 months and was called an “unfathomable sum.”
The legality of Musk’s pay package is uncertain, even if shareholders approve it again and Tesla moves its legal headquarters from Delaware to Texas.
“Even if shareholders approve the old package, it is unclear whether a court in Delaware will recognize this vote as effective,” said Adam Badawi, a law professor at the University of California, Berkeley Reuters.
Musk’s pay package would put him well ahead of even the highest-paid U.S. CEOs. According to a June AP survey, the current top earner is Broadcom’s Hock E. Tan, whose total compensation is $162 million. According to the same list, Apple’s Tim Cook earns roughly $63 million.
Tesla CEO Elon Musk. Photo: FREDERIC J. BROWN/AFP via Getty Images
Wednesday statement of CalPERS, which owns 9.2 million Tesla shares as of June 7, points out that the proposed compensation package is nearly 140 times higher than the annual pay of other successful CEOs.
Musk’s compensation could be “excessive” in comparison with his colleagues and “highly dilutive” from the perspective of shareholders, said CalPERS CEO Marcie Frost.
CalPERS also highlighted that the compensation package exceeds Tesla’s net income of $33.8 billion over the last 4 years (2020-2023).
But for shareholders who voted for the pay package, it is not necessarily about the money.
Last week, Tesla CEO Robyn Denholm wrote in a letter to shareholders that Musk’s compensation package is “obviously not about money” and is actually about “keeping Elon’s attention and motivating him.”
The letter caused apprehension before the meeting that Musk could leave Tesla if his compensation was not approved.
Voting ends Thursday at 5:30 p.m. ET, and the final results shall be officially announced at Tesla’s annual shareholder meeting, which begins Thursday at 4:30 p.m. ET.